April Fools! United States Has Highest Corporate Tax Rate

Yes, today as many people try to outwit their friends and family with April Fools jokes, Japan has lowered their corporate tax rate leaving the United States with the highest corporate tax rate (a true joke on American businesses, consumers and taxpayers).  According to an op-ed by Sen. John Barrasso (R-Wy.) on Foxnews.com, “As of Sunday, April first, the United States will have the highest corporate tax rate in the world. This new record is not something that would make most Americans proud. We take the title as Japan cuts its tax rate by five percent. America’s business tax rate now tops out at 35 percent. Add state taxes and American job creators face a median rate of 39.2 percent.  The United States was in the middle of the pack when we last changed our rates in 1993. Since 2000, however, 30 of the world’s leading developed countries — looking to boost their economies — have cut their rates.”  Inaction by Congress and the White House to lower the rate will have disastrous effects on the recovery of a frail economy.   Check out this short video by the RATE Coalition.

Cutting the corporate tax rate is an important step in helping the economy get back on track.  The corporate tax rate of 35 percent (effectively 39 percent with state taxes) is an example of an outdated tax system and a burden that stifles innovation and business expansion.  This rate is higher than every one of America’s major European trading partners and is higher than China or Canada. In fact, since 1992, the average OECD combined statutory rate has been lower than America’s and it has continued to fall. Today, it is nearly 10 percent lower (25.1 percent) than America’s 35 percent. Add in the state and local taxes that U.S.-based companies pay and the gap widens even further.  According to the Tax Foundation, “While there are many benefits of cutting the U.S. corporate tax rate, we’ve compiled 10 that should help convince lawmakers that this is the right policy direction for the nation….Cutting the corporate tax rate will promote higher long-term economic growth.  Cutting the corporate tax rate will improve U.S. competitiveness.  Cutting the corporate tax rate will lead to higher wages and living standards.  Cutting the corporate tax rate will boost entrepreneurship, investment, and productivity.  Cutting the corporate rate lowers the tax burden on low-income taxpayers and seniors.  Cutting the corporate rate will lower the overall dividend tax rate and taxes on capital.  Cutting the corporate tax rate can attract foreign direct investment (FDI).  Cutting the corporate rate would lead to lower corporate debt and reduce the incentives for income shifting.  Cutting the corporate tax rate can reduce compliance costs.  Cutting the federal corporate rate can help the states compete globally.”

I sat down and recorded some thoughts on why the Taxpayers Protection Alliance supports a real reduction in the corporate tax rate:

VIDEO 1

David Williams talks about cutting the corporate tax rate (Part 1)

VIDEO 2

David Williams talks about cutting the corporate tax rate (Part 2)

VIDEO 3

David Williams talks about cutting the corporate tax rate (Part 3)

VIDEO 4

David Williams talks about cutting the corporate tax rate (Part 4)

VIDEO 5

David Williams talks about cutting the corporate tax rate (Part 5)